The Canadian Mortgage and Housing Corporation (CMHC) will increase its mortgage loan insurance premiums for homeowners and one–four unit rental properties as of May 1, 2014. The increase is in compliance with international industry trends and will help stabilize the mortgage system.

“The higher premiums reflect CMHC’s higher capital targets,” says Steven Mennill, CMHC’s vice-president of insurance operations. “CMHC’s capital holdings reduce Canadian taxpayers’ exposure to the housing market and contribute to the long term stability of the financial system.”

With the introduction of higher premiums, the average Canadian homeowner will see an approximate increase of $5 to their monthly mortgage payment. The increase is not expected to have any dramatic impact on the national housing market.

The increase in premiums follows portfolio insurance changes made by the CMHC earlier in 2014. The new premiums will only affect those requesting new mortgage loan insurance from May 1 onwards.